HMO planning permission

[byterider]

Can someone advise on this please.

After some more reading on HMO law I have got myself confused.

Do the laws that came into effect in April 2010 now mean that "all" new HMOs with 3 or more people need planning permission or is it subject to the LA? What exactly is this likely to cost? An extra £1000+? to get planning permission really hasn't got me leaping for joy.


Byte

[mind the gap]

Can someone advise on this please.

After some more reading on HMO law I have got myself confused.

Do the laws that came into effect in April 2010 now mean that "all" new HMOs with 3 or more people need planning permission or is it subject to the LA? What exactly is this likely to cost? An extra £1000+? to get planning permission really hasn't got me leaping for joy.


Byte
It is up to the local council as to whether they wish to avail themselves of the new powers you describe, or not. In some cases (e.g. areas of heavy studentification) permission may even be withheld from LLs who wish to change the use of a rental property from 2 tenants previously to 3 or more.

Best ring your council and ask whether you need to apply or not and how much it will cost.

[byterider]

Cheers for the quick reply.

The whole thing seems very hazy to me with the October 1st rule change. It seems very unfair that councils now have so much power.

So they can now decide firstly whether they want to give you PP or not and if you get over that hurdle they can fell you upon applying for your licence. Great. I am thinking twice about joining the HMO game.

Byte

[jeffrey]

But:
a. not every Council are a Local Planning Authority; and
b. every Local Planning Authority has always had power to grant/refuse Planning Permission- this has not changed.

[byterider]

Just spoke to my local planning department (Nottingham City Council) and they have said that due to the 1st Oct rule change they do not need any PP for any HMOs up to 5 people.

Although I never dreamed of ever voting blue this whole bit of undue stress has made me rather anoyed with the reds!

However, Im am a happy bunny!

[midlandslandlord]

I'm adjacent to Nottingham, and their enforcement has been *hot* for the last couple of years - it has been used as a strategic tool to force 'bad' (as defined by the Council) landlords out of the game.

You'll need to get it right. I'd go so far as showing them the details of the house before you buy it.

I was talking to my Planning Authority today about HMOs and they are far less up to speed - following national guidelines, but planning one area where *all* rented property will have to be licensed.

Given that a 3 bed house in that area rents for about 300-400 a month, the extra overheads could kill the rental market stone dead if they go the whole hog. The economics of letting seem to be completely off the radar.

The thing that scares me is doing something which will need years to get a return on investment, then having it knocked out of viability by a change of local licensing a couple of years later.

I'd suggest checking, and then working in detail, through the requirements for non-licensed HMOs and verifying the economics e.g., are you required to spend £200-300 a year on maintenance inspections of the mains fire alarm system every 6 months? Most of it is absolutely necessary, but can affect viability. On the properties I quoted above, I reckon the overheads of full licensing could take easily out 1-2 months rent every year.

But in praise of my L.A., they have offered to come to any properties I'm thinking about seriously as HMOs, and give me informal advice before I even buy one.

ML

[mind the gap]

ML, do you mean that a 3 bed HMO would only command a rent of £300-£400 per month? Or is that with a couple/family in a 3 bed house?

HMOs tenanted by students/young profs with separate or joint ASTs usually command a much higher rent than family-occupied properties in the same area, although are higher maintenance, of course.

[midlandslandlord]

ML, do you mean that a 3 bed HMO would only command a rent of £300-£400 per month? Or is that with a couple/family in a 3 bed house?

HMOs tenanted by students/young profs with separate or joint ASTs usually command a much higher rent than family-occupied properties in the same area, although are higher maintenance, of course.


£300-£400 is for a couple/family. A 3 bed HMO would be - guessing (don't have any myself) - 60% more.

But they are talking about licensing *all* rental property to get on top of the 'problem' (and yes, I would agree that there is a problem with poor quality stock etc), so including family units too.

In the whole L.A. area there are only about 100 HMOs currently licensed - overwhelmingly tenants from vulnerable groups.

So this is "selective licensing" of all properties, rather than "additional licensing" of smaller HMOs.

There are other Councils further down this track, e.g., a similarly priced area in Manchester, Gorton North.

Rents £350-£400 for a terraced house:
http://www.globrix.com/property/rent/manchester/gorton-north

Plenty of prices around £50k for a terrace:
http://www.globrix.com/property/buy/manchester/gorton-north

The licenses are for *all* properties in this area:
http://www.manchester.gov.uk/info/10084/private_landlords/718/licensing_of_private_rented_properties/3

And the licenses cost about £350-£500 (once every 5 years until they make the Oxford mistake):
http://www.manchester.gov.uk/site/scripts/documents_info.php?documentID=3420

And here's what you have to do to get one:
http://www.manchester.gov.uk/downloads/download/2201/landlord_licensing_conditions
PDF:
http://www.manchester.gov.uk/download/6193/conditions_for_getting_a_landlord_licence_not_for_ house_in_multiple_occupation

(That is actually quite reasonable - mainly best practice - but I'd like to know the limits of what they can demand).

Others are more demanding.

ML

ML

[midlandslandlord]

Newcastle is one where conditions are far more demanding:

http://www.newcastle.gov.uk/wwwfileroot/regen/phep/selective_licensing_A4_guide.pdf

That is a 9000 word document, though it includes a quick guide to HHSRS.

The info page is here:
http://www.newcastle.gov.uk/core.nsf/a/selectivelicensing

I'm sure I've seen one somewhere that demands routine CRB checks for all landlords. Aha - Middlesborough do.

Some Councils seem to be offering carrots - e.g., free tenant vetting services:

http://www.middlesbrough.gov.uk/ccm/navigation/housing/housing-protection-service/anti-social-behaviour--landlord-and-tenant-support/?page=3

ML

[mind the gap]

Yes, I know the Newcastle HMO system very well!

It does insist on a CRB check (which I don't disagree with, in principle - LLs of vulnerable tenants should be able to demonstrate they are not criminals) - but sensibly they agreed to accept my most recent teacher's one, rather than make me pay another £40 for a separate one. You would think that since they charge the highest fee in the land for the HMO licence (£1100), they would pay for the CRB check.

[midlandslandlord]

At a slight risk of derailing the thread, my position on CRB checks is a little more radical.

The system is disfunctional anyway - and there is a constant trickle of innocent people being forced out of teaching and other caring professions after careers of 10, 20 or 30 years, largely because of mandated or discretionary disclosure of past false allegations or those rejected by the police, and school governors and others treating the victims of those allegations as lepers because they are scared of the bad PR.

I can see that we have to accept CRB checks to managers of HMOs for vulnerable groups since the damned law exists even if they are useless, but application to all LLs is knee-jerk box-ticking. Even if they worked, they are supposed to be about regular supervisory contact, and we all know that there's a hatful of laws that landlords are threatened with preventing that.

Personally, I would rather sell up property than do a CRB check for a tenancy which should not require one.

ML

[midlandslandlord]

Yes, I know the Newcastle HMO system very well!


I'm interested in the detailed costings of how Selective Licensing will impact on rented property in low rent areas, as where I've been looking I don't see how anything other than an ultra-light touch will allow private rental to remain viable. And I don't think Council Rent regulators do light-touch.

Fortunately I have nothing in targeted areas.

ML

[mind the gap]

I'm interested in the detailed costings of how Selective Licensing will impact on rented property in low rent areas, as where I've been looking I don't see how anything other than an ultra-light touch will allow private rental to remain viable. And I don't think Council Rent regulators do light-touch.

Fortunately I have nothing in targeted areas.

ML
Sorry, what I meant was I know the mandatory HMO licensing well. I think Newcastle City Council are keen to limit the spread of high density 'studentification' in residential areas but how they propose to do it, I'm not sure. One measure they have implemented is to limit planning consent for any more loft conversions in Tyneside flats (a favourite with BTL landlords, although they were never designed for 6 adults to live in!). Basically they make the planning conditional on the property never being let out to students.

Not sure how Selective Licensing will work in non-student areas.

[midlandslandlord]

Not sure how Selective Licensing will work in non-student areas.


It won't work :-)

It will select out all the rented properties and drive them away, then the Council will have to spend the Licensing budget on B&B for all the tenants who no longer have houses.

Alernatively it will drive up all the rents.

However, if the area (and the LHA budget) can take the increased rent levels to cover the admin and regulated improvements, then it *may* work.

But in this case it will probably only work in these expensive areas which are not the ones being targetted for improvement.

Sigh. This is like falling out of an aeroplane and missing a pitchfork in a haystack, then missing the haystack.

So I'll take Selective Licensing to a separate thread another time.

ML

[byterider]

CRB'S.... what a well run government department. Upon taking a year out from main stream teaching to focus on rental properties I registered with 2 supply agencies in June. I received one CRB back in late OCT and the other one is still being processed.....

What Manchester CC are doing seems ludicrous! That would be a killer blow if all LL's had to get a license HMO or not HMO. Why punish the whole class just because of a few naughty ones? If they want to route out bad landlords they should provide a decent scheme where good landlords can be regcognised without having to be forced to pay through the roof for it.

What LA are you two in? Nottingham seems to be OK for the time being, there isn’t much selective licensing yet although I have been told they are going to start having a go at enforcing selective licensing on smaller HMO's in some areas within the next few months. I doubt it will happen any time soon though.

It is clear that the LA have had enough of HMO's in the more studenty areas. Every house they sell off that might have the slightest chance of being turned into an HMO has been changed to leasehold and had a new covenant slapped on it to prevent HMO letting.

[midlandslandlord]

I'm in North Notts/Derbys, and my LA is not far down the track yet.

I've not mentioned actual names of areas as that would identify individuals.

I'm fine with HMO licensing, but I have a concern about the impact of indiscriminate selective licensing over a longish period.

And I don't think that the question has had any real attention yet, nor is it really on the radar of very many :-).

ML